Can I use watermarked green/blue screen footage?

No. 'fair use' is about the use of material to support things like documentaries - for example, if you were making a documentary about some environmental issue you could use news clips that illustrate different sides to the debate - you can't just download copyrighted material and drop it in a narrative film and call it 'fair use'.

There's a great video here where two US entertainment lawyers discuss fair use (amongst other things): http://www.youtube.com/watch?v=EQxY3Cr3J8s
 
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